Brian Kirchmann, the outgoing CEO of South African commercial property association Sapoa, says he is concerned about the negative effect the amendments to stamp duty are having on the commercial property industry.

Kirchmann, 63, who is retiring from Sapoa after 16 years of involvement with the organisation, says the stamp duty amendments are of "grave concern".

The South African Revenue Service (SARS) said in January it was implementing a flat-rate stamp duty, which effectively doubles the duty paid on property leases of five years or less.

Concerns that the profitability of property-owning companies and tenants will be harmed by the move have been voiced before.

Kirchmann says the amendment should be revisited by the national treasury. He says that prior to SARS's announcement, Sapoa had been promised an opportunity to have a workshop on amendments so "we could all be quite comfortable" with them.

"That workshop never happened. To our great surprise, when we came back from shutdown in January we found the act was about to be promulgated and only awaiting the signature of the president," says Kirchmann.

"All the extra costs get passed onto the tenant, who passes it on to the man in the street."

Kirchmann says another area of concern for the commercial property industry is the fact that the Competition Commission requires notification of any property transaction worth more than R30m.

"We have repeatedly requested that this threshold should be at a minimum of R250m because a R30m property transaction is a small property transaction in terms of commercial property."

Kirchmann says it is also almost impossible for a property transaction to be anticompetitive because any property transaction has to be market-related as the tenant can only pay a market- related rental.

He says the tenant, in turn, has to be competitive with the pricing of his product or service.

"We do believe that this issue should be revisited. A property transaction should not be encumbered by the Competition Commission, which puts another hurdle in the path of overseas investors when considering investment in property in SA."

Kirchmann last week presided over an annual Sapoa convention that saw a record number of delegates in attendance.

Just short of 1000 delegates attended the 37th convention at Sun City in North West. That was an increase over the 850 representatives who attended last year's convention in Cape Town.

Kirchmann, who was appointed as executive director of Sapoa in January 1990 and became CEO in 1995, says he took the decision to retire with "mixed feelings".

He says there is a need for transformation from within the secretariat of Sapoa.

But Kirchmann says he is sad about leaving because he is "passionate" about the industry.

"I really enjoy and love the people," he says.

Kirchmann, who will retire in August and hand over the reins to chief operating officer Neil Gopal, says he "will be doing my bit in a coaching capacity for the next three months".

Kirchmann is highly respected in the commercial property industry for the role he has played in promoting the industry.

A number of property pundits at the convention said afterwards that Kirchmann was synonymous with Sapoa and that he would be sorely missed.

Kirchmann started Sapoa's shopping centre committee in the early 1990s. This later evolved into the South African Council of Shopping Centres.

During his leadership of Sapoa, the South African Property Index (SAPIX) was initiated with Investment Property Databank (IPD). The IPD/SAPIX is a highly respected benchmark of property performance in SA.

Kirchmann has led Sapoa during the property market's good and bad times.

"The property market has been very tough for a number of years and naturally we found it very difficult to justify why they (members) should belong to this organisation. However, many saw the benefits of being able to network and interact with people of the industry," he says.

Kirchmann says it is "very gratifying" to retire from Sapoa at a time when property is a well-respected investment and the "flavour of the month".

"But I have always been of the opinion that property has always and will always be an excellent long-term investment," he says.

Kirchmann has also substantially grown Sapoa's educational property programmes.

"We also took a huge step as far as property educational courses are concerned. From only one course in 1990, called the Property Development Programme, we now run a total of 10 property courses ranging from one-day courses to a year-long correspondence course," he said.

Kirchmann says that he would now like to spend more time with his family.

He said he was confident in the ability of Sapoa's officials and directors to lead the organisation into the future.

Business Day